Supreme Court's Tiger Global Ruling: Pre-2017 Mauritius Investments at Risk, Grandfathering Neutralized

• Supreme Court ruled Tiger Global's $1.6 billion Flipkart stake sale to Walmart is taxable in India, denying capital gains tax exemption under India-Mauritius DTAA.
• The court concluded the investment structure amounted to treaty shopping and tax avoidance, emphasizing commercial substance and intent over merely a Tax Residency Certificate (TRC).
• Experts warn the judgment could expose a wide range of pre-2017 foreign investments routed through Mauritius to scrutiny, despite previous assurances of grandfathering.
• The ruling effectively neutralizes grandfathering provisions, putting all pre-April 1, 2017, investments in jeopardy, according to legal experts.
• The tax department is now emboldened to scrutinize past deals, and investors must reassess structures for real substance, as TRC alone is no longer sufficient for treaty benefits.

Why It Matters: Supreme Court's Tiger Global ruling jeopardizes pre-2017 Mauritius investments, prioritizing substance over form and TRC.